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Finding a balance between business objectives and financial return has become harder to justify for many marketers. With the plethora of marketing channels available today, an increasing pain point is identifying which media work to drive KPI and their role in short and long term business impact.

Gain Theory has produced a research study for ThinkBox as part of the Profit Ability report, which addresses the problem of how to effectively measure the long-term impact of media investment. This is the first study of its kind that discusses the issues involved, moving beyond the often-misleading ROI ratios, and showing the genuine difference that advertising makes.

In an interview with The Times Gain Theory Partner and senior practitioner, Matthew Chappell who led of the research said “Advertising spend has been a hot debate in marketing for some time. There is more data floating around than ever before. However, there tends to be a focus on short-term metrics, which is why this study is so important.

“If you publish a video, say, on a social-media channel, you see that it gets a certain number of likes and shares within the first half hour. But how do you know that it is building long-term success? It is very easy for marketing departments to see what’s driving short-term success, and put all their money in and focus on that. In doing so, though, you run the risk of losing sight of what is propping up the long-term business value.”

Mr Chappell says there is a long-term multiplier effect that many chief executives may not know about. “The findings show that there is often a multiplier to short-term impact,” he says. “For example, if the multiplier is two and you generate a million sales within the first three months of a campaign, then you are likely to make two million in three years.

“Bearing that in mind, we looked at the whole plethora of channels and the results showed TV tends to come out as the strongest medium.

“The numbers we have created are robust, and should provide confidence to chief executives and chief financial officers, and show TV advertising works best in the long and short term. Hopefully this study will add to and shift the conversation away from those short-term, easily measured metrics.”

Long term impacts of advertising study

Watch Matthew discussing the Long Term study:

Watch the full Profit Ability launch event session where Matthew presents the study:

To download the study, click here.
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